Saturday, May 5, 2018

After sales drop Nissan may cut jobs at UK diesel plant

The Japanese car manufacturer Nissan may cut hundreds of jobs at its Sunderland plant in the UK. Nissan is Britain's largest car manufacturer.

Diesel sales are plummeting

Diesel sales have been declining and these layoffs bring one more blow to the UK auto industry. Nissan would not confirm the job losses. However, local reports suggest that long-serving staff could be asked to take voluntary redundancy. Unite, the union at the plant had been assured that there would be no compulsory layoffs at the plant. There are about 7,000 workers at the site. A source with knowledge of the situation says that hundreds of jobs would likely go at Sunderland.

The manufacturer would not confirm any job losses, although local reports suggested long-serving staff could be asked to take voluntary redundancy.

Overall drop in demand

So far this year Nissan's British sales have gone down more than one third. Even in a dismal year so far for everyone this is a substantial drop. However, overall demand is down a more modest 12 percent. Nissan exports 8 out of ten of the cars it makes in the UK. Across Europe in March, Nissan sold only 75,000 vehicles as compared with 91,000 in March of 2017.

Nissan claimed that its job cuts would be short term as the company was looking to build new versions of the Qashqiai, Juke, Infinity and the new X-trail using new technology.

A spokesperson for Nissan said: “As previously communicated, we are transitioning to a new range of powertrains over the next year. As we make the operational changes required to support this, we will be managing a planned short-term reduction in powertrain supply and plant volumes in line with our 2018 business plan. We are now discussing these operational changes with our employees.”

Steve Bush an official with the union Unite said:“Unite has been assured that any job reductions will be on a voluntary basis and on enhanced terms.Over the coming weeks, we will be giving our members maximum support and ensuring that they can make informed choices about their future. We expect to see temporary workers at the plant move into permanent positions as volumes pick up again in future years.”

Jaguar Land Rover also cuts jobs

Jaguar Land Rover (JLR) also is cutting jobs and reducing output at two of its UK plants. Although Nissan claimed that its decision had nothing to do with Brexit, JLR claimed that it did. However, sales are also impacted by restrictions on diesels in some countries.

Vauxhall also cutting back

Another UK automaker Vauxhall is also cutting by terminating the contracts of all its 326 dealers across the UK. Although the dealers employ about 12,000 people the company claimed that it did not expect there would be heavy job losses from the move.

Industry has expressed fears over Brexit but Nissan promised it would manufacture new models in the UK.

Consumers are being discouraged from buying diesels. The Society of Motor Manufacturers claims that diesel vehicles are being "demonised" . UK tax policy is deterring customers from buying new diesels. There was a small tax increase on diesels this month.

Restrictions on diesels are expected to take place in several cities in the UK. In Europe where many Nissan diesels are exported we can expect to see an outright ban on diesels in many cities in the next five to seven years.

David Bailey a professor of industrial policy at Aston University said:“Certainly there is a massive shift away from diesels across Europe. There is a perfect storm combining dieselgate, legislative changes and the reduction in resale values for owners of the cars. Nissan are exposed to that, as about 25% of what Nissan produce up in Sunderland is diesel. But they have a lot of hybrid technology after the takeover of Mitsubishi which we can expect to see more of, as well as the electric technology behind the Leaf, so I think they are well positioned to see through this temporary shock.”

Nissan Motor Company

Nissan Motor Company Ltd. is a multinational automobile maker with headquarters in Nishi-Ku, Yokahama. The company makes Nissaan and Infiniti brands. Since 1999 Nissan has been part of the Renault=Nissan-Mitsubishi Alliance. As of 2014 Renault of France held a 43.5 percent stake in voting shares. In turn Nissan has a 15 percent share of Renault shares.

In 2013 Nissan was the sixth biggest automaker globally. Toyota and GM are first and second. Nissan is the most popular Japanese brand in China, Russia, and Mexico.

Nissan is one of the world's largest electric vehicle(EV) producers. As of mid-December of 2016 it had sold 275,000 EVs world wide. The most popular brand is the Leaf, a world top seller. As of September 2016 it had sold 240,000 units. Nissan was also the largest car manufacturer in North America.